Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

1,130

1,167

971

Amortization of purchased intangibles

54

33

31

Restructuring, impairment and other charges

71

67

Stock compensation charges

46

58

54

Equity in earnings of affiliated companies

(299)

(266)

(547)

Dividends received from affiliated companies

143

1,704

630

Deferred tax provision

54

612

189

Restructuring payments

(40)

(39)

(35)

Customer deposits

197

Employee benefit payments (in excess of) less than expense

(52)

(52)

52

Gains on translated earnings contracts

(80)

(1,369)

(435)

Unrealized translation losses on transactions

268

431

96

Contingent consideration fair value adjustment

(13)

(249)

Changes in certain working capital items:

Trade accounts receivable

162

(16)

(29)

Inventories

(77)

2

(247)

Other current assets

(57)

(16)

34

Accounts payable and other current liabilities

(146)

(3)

(23)

Other, net

180

169

18

Net cash provided by operating activities

2,809

4,709

2,787

Cash Flows from Investing Activities:

Capital expenditures

(1,250)

(1,076)

(1,019)

Acquisitions of businesses, net of cash received

(732)

66

(68)

Proceeds from sale of a business

12

Investment in unconsolidated entities

(33)

(109)

(526)

Proceeds from loan repayments from unconsolidated entities

6

23

8

Short-term investments – acquisitions

(969)

(1,398)

(1,406)

Short-term investments – liquidations

1,629

1,167

2,026

Premium on purchased collars

(107)

Realized gains on translated earnings contracts

653

361

87

Other, net

(1)

4

1

Net cash used in investing activities

(685)

(962)

(1,004)

Cash Flows from Financing Activities:

Retirement of long-term debt, net

(498)

Net repayments of short-term borrowings and current portion of long-term debt

(12)

(52)

(71)

Proceeds from issuance of long-term debt, net

745

248

Proceeds from issuance of short-term debt, net

3

29

Proceeds from issuance of commercial paper

481

Proceeds (payments) from the settlement of interest rate swap agreements

(10

33

Principal payments under capital lease obligations

(6)

(6)

(7)

Proceeds from issuance of preferred stock(1)

400

Proceeds received for asset financing and related incentives, net

1

1

276

Payments to acquire noncontrolling interest

(47)

Proceeds from the exercise of stock options

102

116

85

Repurchases of common stock for treasury

(3,228)

(2,483)

(1,516)

Dividends paid

(679)

(591)

(566)

Net cash used in financing activities

(2,603)

(2,586)

(2,063)

Effect of exchange rates on cash

(330)

(556)

(4)

Net increase (decrease) in cash and cash equivalents

(809)

605

(284)

Cash and cash equivalents at beginning of year

5,309

4,704

4,988

Cash and cash equivalents at end of year

$ 4,500

$ 5,309

$ 4,704

(1) In the first quarter of 2014, Corning issued 1,900 shares of Preferred Stock to Samsung Display Co., Ltd. in connection with the acquisition of their equity interests in Samsung Corning Precision Materials Co., Ltd. (Note 8). Corning also issued to Samsung Display an additional 400 shares of Preferred Stock at closing, for an issue price of $400 million in cash (Note 17).

The accompanying notes are an integral part of these consolidated financial statements.